Les interactions fiscales verticales à la lumière de la théorie des multiprincipaux
The very essence of both federal and unitary countries is multi-tiered governments. This architecture typically involves some commonality of tax bases between higher- and lower-level authorities. This process points to the existence of vertical externalities, i.e. of an inefficiently high degree of taxation. The central purpose of this paper is to explore the distribution of taxing powers among tiers of governments, and to analyze the nature and the consequences of the vertical externality that arises when different levels of government share joint property tax bases. To that end, the multi-principal theory is highly relevant since the different layers of government can be regarded as competing power centres. We provide a simple taxation model and consider a structure of overlapping governments that co-occupy a same tax base. We show that an independent behaviour of both levels of government results in the cumulated tax rate being too high with respect to a cooperative solution. Actually, when she independently makes her choice and unilaterally raises her tax rate, each level of government ignores the losses of fiscal receipts that other levels will suffer from the induced contraction of the shared tax base. Hence she under-valuates the social marginal cost of raising tax revenue from the common tax base. However, information asymmetry tends to lower the global level of taxation as some rents have to be given up to firms in order to make them reveal their private feature. JEL classification: D72, D82, H23, H30, H32, H71, H77
Volume (Year): 78 (2012)
Issue (Month): 1 ()
|Contact details of provider:|| Web page: http://www.cairn.info/revue-recherches-economiques-de-louvain.htm|
References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Johnson, William R, 1988. "Income Redistribution in a Federal System," American Economic Review, American Economic Association, vol. 78(3), pages 570-573, June.
- Jean-Jacques Laffont & Jean Tirole, 1993. "A Theory of Incentives in Procurement and Regulation," MIT Press Books, The MIT Press, edition 1, volume 1, number 0262121743, July.
- Goodspeed, Timothy J., 2002.
"Tax competition and tax structure in open federal economies: Evidence from OECD countries with implications for the European Union,"
European Economic Review,
Elsevier, vol. 46(2), pages 357-374, February.
- Goodspeed, Timothy J., 1999. "Tax competition and tax structure in open federal economies: evidence from OECD countries with implications for the European Union," ZEW Discussion Papers 99-39, ZEW - Zentrum für Europäische Wirtschaftsforschung / Center for European Economic Research.
- Goodspeed, Timothy J., 1998. "The Relationship Between State Income Taxes and Local Property Taxes: Education Finance in New Jersey," National Tax Journal, National Tax Association, vol. 51(2), pages 219-238, June.
- Goodspeed, Timothy, 1998. "The Relationship Between State Income Taxes and Local Property Taxes: Education Finance in New Jersey," MPRA Paper 29549, University Library of Munich, Germany.
- Diaw, K. & Pouyet, J., 2004. "The Dilemma of Tax Competition : How (not) to attract (Inefficient) Firms?," Discussion Paper 2004-68, Tilburg University, Center for Economic Research.
- Zantman, Wilfried, 2002. " Constitutional Design and Regional Favoritism," Journal of Public Economic Theory, Association for Public Economic Theory, vol. 4(1), pages 71-93.
- Zissimos, Ben & Wooders, Myrna, 2008. "Public good differentiation and the intensity of tax competition," Journal of Public Economics, Elsevier, vol. 92(5-6), pages 1105-1121, June.
- Ben Zissimos & Myrna Wooders, 2003. "Public Good Differentiation and the Intensity of Tax Competition," Vanderbilt University Department of Economics Working Papers 0710, Vanderbilt University Department of Economics.
- Michael Keen, 1998. "Vertical Tax Externalities in the Theory of Fiscal Federalism," IMF Staff Papers, Palgrave Macmillan, vol. 45(3), pages 454-485, September.
- Michael Keen, 1997. "Vertical Tax Externalities in the Theory of Fiscal Federalism," IMF Working Papers 97/173, International Monetary Fund.
- Cassing, J H & Hillman, A L, 1982. "State-Federal Resource Tax Rivalry: The Queensland Railway and the Federal Export Tax," The Economic Record, The Economic Society of Australia, vol. 58(162), pages 235-241, September.
- Keen, Michael J. & Kotsogiannis, Christos, 2004. "Tax competition in federations and the welfare consequences of decentralization," Journal of Urban Economics, Elsevier, vol. 56(3), pages 397-407, November.
- Michael J. Keen & Christos Kotsogiannis, 2002. "Tax competition in federations and the welfare consequences of decentralization," Discussion Papers 0201, Exeter University, Department of Economics.
- Page, Frank Jr. & Monteiro, Paulo K., 2003. "Three principles of competitive nonlinear pricing," Journal of Mathematical Economics, Elsevier, vol. 39(1-2), pages 63-109, February.
- Frank Page & Paulo Monteiro, 2001. "Three Principles of Competitive Nonlinear Pricing," Economics Bulletin, AccessEcon, vol. 28(11), pages 1.
- Page, F.H.Jr. & Monteiro, P.K., 2001. "Three Principles of Competitive Nonlinear Pricing," The Warwick Economics Research Paper Series (TWERPS) 592, University of Warwick, Department of Economics.
- Page Junior, Frank H. & Monteiro, P. K., 2002. "Three principles of competitive nonlinear pricing," FGV/EPGE Economics Working Papers (Ensaios Economicos da EPGE) 442, FGV/EPGE - Escola Brasileira de Economia e Finanças, Getulio Vargas Foundation (Brazil).
- Frank H. Page & Paulo Klinger Monteiro, 2002. "Three principles of competitive nonlinear pricing," Game Theory and Information 0204001, EconWPA.
- Martimort David & Stole Lars, 2003. "Contractual Externalities and Common Agency Equilibria," The B.E. Journal of Theoretical Economics, De Gruyter, vol. 3(1), pages 1-40, July.
- Martimort, David & Stole, Lars, 1999. "Contractual Externalities and Common Agency Equilibria," IDEI Working Papers 110, Institut d'Économie Industrielle (IDEI), Toulouse, revised 2003.
- David Martimort & Lars Stole, 2001. "Contractual Externalities and Common Agency Equilibria," CESifo Working Paper Series 581, CESifo Group Munich.
- Olsen, Trond E. & Osmundsen, Petter, 2001. "Strategic tax competition; implications of national ownership," Journal of Public Economics, Elsevier, vol. 81(2), pages 253-277, August.
- Olsen, T.E. & Osmundsen, P., 1998. "Strategic Tax Competition; Implications of National Ownership," Papers 11/98, Norwegian School of Economics and Business Administration-.
- Trond Olsen & Petter Osmundsen, 2000. "Strategic Tax Competition; Implications of National Ownership," CESifo Working Paper Series 281, CESifo Group Munich.
- repec:adr:anecst:y:1992:i:28:p:01 is not listed on IDEAS
- David E. Wildasin, 2005. "Fiscal Competition," Working Papers 2005-05, University of Kentucky, Institute for Federalism and Intergovernmental Relations.
- Martimort, David, 1996. "The multiprincipal nature of government," European Economic Review, Elsevier, vol. 40(3-5), pages 673-685, April.
- David Martimort, 1992. "Multi-principaux avec anti-sélection," Annals of Economics and Statistics, GENES, issue 28, pages 1-37.
- Mortimort, D., 1992. "Multi-principaux avec anti-selection," Papers 92.f, Toulouse - GREMAQ.
- Martimort, David, 1992. "Multi-Principaux avec Anti-Sélection," IDEI Working Papers 14, Institut d'Économie Industrielle (IDEI), Toulouse.
- David Martimort & Lars Stole, 2002. "The Revelation and Delegation Principles in Common Agency Games," Econometrica, Econometric Society, vol. 70(4), pages 1659-1673, July.
- David Martimort & Lars Stole, 2001. "The Revelation and Delegation Principles in Common Agency Games," CESifo Working Paper Series 575, CESifo Group Munich.
- Masayoshi Hayashi & Robin Boadway, 2001. "An empirical analysis of intergovernmental tax interaction: the case of business income taxes in Canada," Canadian Journal of Economics, Canadian Economics Association, vol. 34(2), pages 481-503, May.
- Dahlby, Bev & Wilson, Leonard S., 2003. "Vertical fiscal externalities in a federation," Journal of Public Economics, Elsevier, vol. 87(5-6), pages 917-930, May.
- Robin Boadway & Michael Keen, 1996. "Efficiency and the optimal direction of federal-state transfers," International Tax and Public Finance, Springer;International Institute of Public Finance, vol. 3(2), pages 137-155, May.
- Robin Boadway & Michael Keen, 1996. "Efficiency and the optimal direction of federal-state transfers," IFS Working Papers W96/01, Institute for Fiscal Studies.
- Michael J. Keen & Christos Kotsogiannis, 2002. "Does Federalism Lead to Excessively High Taxes?," American Economic Review, American Economic Association, vol. 92(1), pages 363-370, March.
- David Martimort & Lars Stole, 2009. "Market participation in delegated and intrinsic common-agency games," RAND Journal of Economics, RAND Corporation, vol. 40(1), pages 78-102.
- Craig Brett & Joris Pinkse, 2000. "The determinants of municipal tax rates in British Columbia," Canadian Journal of Economics, Canadian Economics Association, vol. 33(3), pages 695-714, August. Full references (including those not matched with items on IDEAS)
When requesting a correction, please mention this item's handle: RePEc:cai:reldbu:rel_781_0027. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Jean-Baptiste de Vathaire)
If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.
If references are entirely missing, you can add them using this form.
If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.
If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.
Please note that corrections may take a couple of weeks to filter through the various RePEc services.